Canada goes on offensive in pipeline PR war

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Away from the loud protests and clever signs that opponents have wielded against the Keystone XL pipeline, Canada's government and industry are quietly fighting back.

Over the span of the past two years, they have spent millions on lobbyists and flown executives across the border in an increasingly urgent bid to press their case with U.S. politicians and officials. Their efforts have largely been carried out in private. Yet public records make clear the scale of their exertions, and the importance Canada's energy companies, with support from the governments of Canada and Alberta, have placed on pushing the project through.

In the past two years, TransCanada Corp. , which is seeking to build the $7-billion pipeline, has spent over $1.5-million on U.S. federal lobbyists, and even more in individual states like Nebraska, where opposition has been the most vocal. That's in addition to the money it has poured into advertising campaigns, which include a current print, TV and online effort in Washington, D.C., aimed at persuading decision makers that the pipeline will help "real Americans."

TransCanada has been joined by the Canadian Association of Petroleum Producers (CAPP), which has marshalled the considerable connections of Gordon Giffin and David Wilkins, both former U.S. ambassadors to Canada, to press the case for the pipeline and the Alberta oil sands. The American Petroleum Institute has banded together with the Laborers International Union of North America to feed union workers and ferry them to public meetings, clothe them in orange shirts and ask them to make the case for the pipeline.

In total, some 28 companies, industry associations and unions have lobbied on Keystone.

Those lobbying efforts have now sparked a growing backlash, as critics examine the connections between industry, the State Department and its head, Hillary Clinton. U.S. environmental group Friends of the Earth has questioned a web of influence that includes Paul Elliott, a former Clinton campaign worker that is now on TransCanada's payroll; David Goldwyn, a State Department worker who once lobbied for the oil industry; and McKenna Long & Aldridge, a TransCanada lobbying firm that has donated heavily to Ms. Clinton – although its employees also gave substantial amounts to other candidates, including John McCain, in the 2008 election.

But the multibillion-dollar petroleum industry says it has little choice but to enlist influential people in its fight.

"It was done out of necessity, because the environmentalists decided to make Keystone an issue and a lightning rod for the debate around the oil sands," said TransCanada spokesman James Millar.

The company is clearly frustrated.

"There's probably 10 large environmental organizations with a lot more staff that are blogging, that are writing news releases, that are out there in the communities," Mr. Millar said. "I think who is big in this debate is really the environmentalists, not TransCanada."

But the company has on its side an industry whose resources are vast, and whose capital has bought it substantial influence. The use of former ambassadors – one a Democrat, one a Republican – has secured CAPP access to some of the most powerful figures in Washington. That was in evidence last week at an event orchestrated by Mr. Wilkins, when Senator Lindsey Graham, a high-profile Republican, said that denying Keystone XL would be "one of the biggest energy policy blunders in our history."

In an interview, Mr. Wilkins said he is "proud to be associated with CAPP." He has sought to "educate" U.S. decision makers, he said, telling them that "it makes sense for the U.S. to secure more and more energy from Canada."

CAPP hired Mr. Wilkins this summer. His assistance comes amid what Dave Collyer, the association's president, called an "increasing focus on the U.S." by industry.

"It's important both from a policy and communications perspective to get the message out," he said.

Yet amid rising public concern about Keystone XL, it's clear that message has proved unconvincing to many. Alberta Energy Minister Ron Liepert suggests opponents have succeeded by proffering emotional arguments in sound bites.

"We have to counter it with facts – and it takes a lot longer than 15 seconds to get the facts out," he said. "What we need to do is a better job of countering what are frankly lies."

For an industry whose future depends almost entirely on exports – virtually every new drop of oil sands production will exit Canada – promoting Keystone forms part of a broader effort that may require more ambitious campaigns in coming years. For example, Alberta now runs a small office in Washington, where it seeks to makes its case.

Mr. Liepert believes more is needed.

"We need to increase our presence, whether it's in places like Chicago or California," he said. "You wouldn't be doing it based on the Keystone decision. You'd be doing it on an ongoing basis. Because after Keystone, there will be another issue that the environmentalists will be jumping on relative to the oil sands."